Brazil Eyes $68B Bitcoin Reserve to Boost Economic Sovereignty

• Brazil may buy 1M BTC over 5 years, creating the largest national Bitcoin reserve globally.

• Companies can hold, mine, and pay taxes in Bitcoin under the new bill.

• RESbit includes strict rules, transparency reports, and safeguards for citizen custody rights.

Brazil is taking a step toward building a strategic Bitcoin reserve, as Congress reintroduced bill 4501 of 2024. The plan would let the country acquire up to 1 million BTC over the next five years. Federal Deputy Luiz Gastão highlighted that this effort could cost at least $68 billion, which would surpass the Bitcoin holdings of countries like the U.S. and China. The move aims to diversify Brazil’s national assets, protect against inflation, and strengthen financial independence

The bill proposes creating RESbit, the Strategic Sovereign Bitcoin Reserve, which the central bank would manage alongside the Ministry of Finance. It ensures Bitcoin remains immune from confiscation and allows for private custody by citizens.

Gastão noted, “These guarantees are essential to stimulate investment, consolidate an innovative economic ecosystem, and create legal certainty.” Besides direct purchases, the reserve could accumulate BTC through taxes, temporary ETF holdings, and corporate holdings.

Expanding Bitcoin Use Across the Economy

Bill 4501/2024 goes beyond simply buying Bitcoin. It incentivizes companies to hold or mine Bitcoin and even allows Bitcoin payments for federal taxes. Moreover, it forbids selling Bitcoin seized by courts, protecting the asset from government liquidation.

The legislation positions Bitcoin not only as a financial reserve but also as a tool for monetary sovereignty. Consequently, it could back Drex, Brazil’s central bank digital currency.

Congressman Eros Biondini, the bill’s author, highlighted Bitcoin’s scarcity and security properties. He argued these traits make Bitcoin superior or complementary to gold and dollar reserves. Additionally, the bill mandates semi-annual reports from the central bank detailing all transactions and performance of RESbit. This aims to increase transparency and maintain public trust.

Governance and Legal Protections

The law includes strict accountability rules. Article 6 outlines administrative and criminal sanctions for mismanagement of RESbit. Managers must reimburse public funds if they violate regulations. Furthermore, the Internal Revenue Service has 12 months to develop the technological infrastructure necessary for Bitcoin integration.

However, central bank regulations currently do not recognize Bitcoin as a reserve asset, creating potential legal conflicts. Any administrative restriction on user-controlled wallets is void, safeguarding citizen autonomy.

Apart from strengthening reserves, the law also aims to modernize Brazil’s financial ecosystem. International partnerships are encouraged in order to share best practices. The Executive Branch is required to regulate the law within 180 days after its publication.